The present value interest factor of an annuity is calculated to compare the real value of a lump sum payment today and the same amount of money paid over time.

Before explaining how to find the present value of an annuity, we should first define the present value of an annuity. In simplest terms, this is the cash value of all your future annuity payments.

We can use a simple formula to calculate the present value of a perpetuity annuity. This formula will tell us what a perpetuity is worth based on a discount rate, or a required rate of return.

An annuity table is a tool for determining the present value of an annuity or other structured series of payments.

Find out how the annuity formula works and how to calculate present and future value. Get a simple breakdown of key concepts.

Because of the difference in payment timing, the present value of an annuity due will be higher than that of an ordinary annuity with otherwise equal terms.

J. Ingersoll Bowditch, Tables of the Present Value of a Life-Annuity at Any Age, According to Dr. Wigglesworth's Bill of Mortality, Memoirs of the American Academy of Arts and Sciences, New Series, ...

What Are Annuities and How Do They Work? Put simply, an annuity is a contract that allows an investor to use present-day money to fund an ...

Here's how to calculate the present value of a perpetual annuity that promises to pay flat or growing annual payments with helpful examples.